Correlation Between Ab Municipal and Shelton Funds
Can any of the company-specific risk be diversified away by investing in both Ab Municipal and Shelton Funds at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Ab Municipal and Shelton Funds into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ab Municipal Bond and Shelton Funds , you can compare the effects of market volatilities on Ab Municipal and Shelton Funds and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Ab Municipal with a short position of Shelton Funds. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ab Municipal and Shelton Funds.
Diversification Opportunities for Ab Municipal and Shelton Funds
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between AUNTX and Shelton is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Ab Municipal Bond and Shelton Funds in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shelton Funds and Ab Municipal is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Ab Municipal Bond are associated (or correlated) with Shelton Funds. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shelton Funds has no effect on the direction of Ab Municipal i.e., Ab Municipal and Shelton Funds go up and down completely randomly.
Pair Corralation between Ab Municipal and Shelton Funds
Assuming the 90 days horizon Ab Municipal is expected to generate 7.39 times less return on investment than Shelton Funds. But when comparing it to its historical volatility, Ab Municipal Bond is 6.73 times less risky than Shelton Funds. It trades about 0.09 of its potential returns per unit of risk. Shelton Funds is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 2,470 in Shelton Funds on August 30, 2024 and sell it today you would earn a total of 1,745 from holding Shelton Funds or generate 70.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ab Municipal Bond vs. Shelton Funds
Performance |
| Timeline |
| Ab Municipal Bond |
| Shelton Funds |
Ab Municipal and Shelton Funds Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ab Municipal and Shelton Funds
The main advantage of trading using opposite Ab Municipal and Shelton Funds positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ab Municipal position performs unexpectedly, Shelton Funds can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Shelton Funds will offset losses from the drop in Shelton Funds' long position.| Ab Municipal vs. Vanguard Limited Term Tax Exempt | Ab Municipal vs. HUMANA INC | Ab Municipal vs. Aquagold International | Ab Municipal vs. Barloworld Ltd ADR |
| Shelton Funds vs. Gamco Global Gold | Shelton Funds vs. Fidelity Advisor Gold | Shelton Funds vs. First Eagle Gold | Shelton Funds vs. Goldman Sachs Centrated |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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